TVNZ says the changing global TV landscape means it has to fork out on local programming in case its international providers opt to market their shows directly to consumers.
Content director Cate Slater says the broadcaster now signs shorter contracts for international programmes and is committed to making New Zealand TV even if it costs more than a hundred times per show more than buying international rights.
The state broadcaster will spend $20 million on local programming this year, which will equate to 100 extra hours of new content. The increase is about 30 percent more of its budget for shows excluding news and sports, Slater says.
TVNZ already competes with streaming giants such as Netflix and Amazon and faces the threat of its international partners going direct to consumer.
For example, next week Disney launches its own streaming service. The state-owned broadcaster took a $12.4 million writedown on its “onerous” Disney contract back in 2017, two years ahead of it concluding this year.
Slater told BusinessDesk local content resonates with New Zealand audiences.
“We want to have our own content that's exclusive to us," she said.
“It also performs very well - the majority of our top 20 shows are local, our viewers are after it.”
In July, the state broadcaster told parliament it would lose $17 million next year and not pay a dividend. This year it posted a 44 percent slide in net profit to $2.9 million, well ahead of the $1 million profit projected.
Its annual report for the 12 months ended June 30 records a 44 percent decrease in commitments to international programming deals over the next five years, from $186.8 million to $104.4 million. Of this, $38 million is for rights deals ending next year.
“We can’t afford to carry any dead weight. You don’t want to be saddled with one on a multi-year basis,” Slater says.
TVNZ announced its TV line up for next year last night, with its local highlights being reality TV shows the Bachelorette and Treasure Island.
The David Bain podcast Black Hands will be turned into a five-episode series with $5 million of NZ on Air Funding
Sport will also continue to be important, although TVNZ says it is more about event viewing than longer-term rights.
Slater says that the audience of 1.2 million TVNZ had for the live All Blacks semi-final against England was the biggest since the Beijing Olympics in 2008.
Its partner Spark has not released figures for that match but did say its biggest game of the tournament was the New Zealand quarter-final against Ireland which was streamed 212,000 times.
In contrast, TVNZ - which counts in estimated audience numbers rather than individual streams - says its delayed version of that match reached 733,300 people aged over five.
Slater would not be drawn on how many watched the extensive pre- and post-game programming where most of the advertising was placed.
“Our aim was to bring it to the masses, and we made it really entertaining but there are lots of people just conditioned to watching the match itself.”
TVNZ will partner with Spark again for NZ Cricket in a six-year deal for domestic Black Caps games. Its next big sports event will be the America’s Cup 2021.